Currently viewing the tag: "Recession"

We’re for austerity too, but with 10% less arsenic!

by Metavirus on 14 March 2013

Lev’s post about Obama’s frustrating “me-too!” obsession with deficits put me in mind of a cartoon I’ve always wished someone would come up with.  …  So I just came up with it myself.

Untitled

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Ultra Deficit Hawk Bill Gross Says Forget Deficit For Now And Stimulate The Economy

by Metavirus on 22 June 2011

It’s always nice to see a bright beam of fiscal reason in a room darkened by media-enabled thoughtgarbage:

Bill Gross is the manager director of PIMCO, which makes him one of the most important bond traders in the world, if not the most important. And so his exit from the Treasury market a few months ago, plus his intense and very public concern over the deficit, has attracted a lot of concern. [...]

[I]n an unusual mid-month note to his investors, Gross hammered the “anti-Keynesians” in both parties who believe “that fiscal conservatism equates to job growth.” The truth, he says, is just the opposite. “Fiscal balance alone will not likely produce 20 million jobs over the next decade. The move towards it, in fact, if implemented too quickly, could stultify economic growth.” [...]

So what should we do? “Government must temporarily assume a bigger, not a smaller, role in this economy, if only because other countries are dominating job creation with kick-start policies that eventually dominate global markets.” But what about the deficit? “Deficits are important, but their immediate reduction can wait for a stronger economy and lower unemployment. Jobs are today’s and tomorrow’s immediate problem.”…

Gross’s credentials as a deficit hawk are unimpeachable, but he’s arguing here that, to be a deficit hawk over the long term, you need to be jobs-focused now, as no economy with 9 percent unemployment is going to achieve the growth necessary to get its deficit under control. And he’s right.

Will his words be heard in the media cavalcade driving every policymaker to be “serious” about the deficit right now?

Not likely.

h/t Anne Laurie

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Surprise! Wisconsin Gov. Ginned Up Crisis In Order To Screw State Workers

by Metavirus on 18 February 2011

I’m used to a lot of dirty tricks from politicians, but this is pretty shameless:

Wisconsin’s new Republican governor has framed his assault on public worker’s collective bargaining rights as a needed measure of fiscal austerity during tough times.

The reality is radically different. Unlike true austerity measures — service rollbacks, furloughs, and other temporary measures that cause pain but save money — rolling back worker’s bargaining rights by itself saves almost nothing on its own. But Walker’s doing it anyhow, to knock down a barrier and allow him to cut state employee benefits immediately.

Furthermore, this broadside comes less than a month after the state’s fiscal bureau — the Wisconsin equivalent of the Congressional Budget Office — concluded that Wisconsin isn’t even in need of austerity measures, and could conclude the fiscal year with a surplus. In fact, they say that the current budget shortfall is a direct result of tax cut policies Walker enacted in his first days in office.

Nothing like a ginned up crisis to create a handy opportunity to get your way.

Come to think of it, doesn’t this sound like what the Republicans in Congress did under George W.?  Run up trillions of dollars in debt and then turn around and start screaming about how America is on the brink of financial collapse?  Say what you want about them, they’re pretty crafty.

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Guess Which State Used The Most Stimulus Money To Plug Its Budget Gaps

by Metavirus on 24 January 2011
Just one more sheaf of evidence to stuff in the overflowing “whiny hypocrites who blubber constantly about federal meddling” file:
Turns out Texas was the state that depended the most on [funds from the federal stimulus bill] to plug nearly 97% of its shortfall for fiscal 2010, according to the National Conference of State Legislatures. Texas, which crafts a budget every two years, was facing a $6.6 billion shortfall for its 2010-2011 fiscal years. It plugged nearly all of that deficit with $6.4 billion in Recovery Act money, allowing it to leave its $9.1 billion rainy day fund untouched.
Yep, you read that correctly. God-fearing, gun-loving Texas used eeee-vil stimulus funds to plug 97% of its 2010-2011 budget shortfall. All this after possible secessionist Governor Rick Perry when on a big whinefest in the national media about how Texas could take of itself, thank you very much:
When he made a show of rejecting some Recovery Act money, Perry said “this was pretty simple for us…We can take care of ourselves.” As The Wonk Room explained, in addition to filling nearly his entire budget gap with Recovery Act funds, Perry also used the Build America Bonds program — created as part of the Recovery Act — to fund billions of dollars in infrastructure projects. He also grandstanded against — and then promptly accepted — federal funding meant to prevent teacher layoffs.
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Quote of the Day: Washington Is There To Serve The Banks

by Metavirus on 13 December 2010


Here is something to warm your heart from the incoming GOP Chairman of the House Financial Services Committee:

“In Washington, the view is that the banks are to be regulated, and my view is that Washington and the regulators are there to serve the banks.”

Wouldn’t you think that by the time someone rose to a position of power in Congress, they would be better at not giving away the not-so-secret game they’re playing over there?

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How Are The Democrats Not Guilty of Political Malpractice on Tax Cuts?

by Metavirus on 6 December 2010

This came out of a chat with Gherald earlier:

how are democrats not guilty of political malpractice when they are incapable of properly messaging on (1) Democrats are trying mightily to pass middle class tax cuts and (2) republicans are filibustering that?

I just don’t just how that isn’t the easiest fucking thing to win the message war with. I mean, you keep lobbing these guys golden opportunities for quality, Politics 101-level messaging and they constantly fumble it two yards from where they caught the pass.

Update: I never thought I’d say this but… More Democrats need to sound like John Kerry on this:

You care about unemployment? We’re committed to extending benefits that can help families stay above water, hold onto their houses if possible, and have at least some spending power as they keep looking for work. You need a tax break in a recession? We agree — we want to cut taxes for every household in the country. And that’s why we’re in a fight with the Republican minority that is determined to stop tax relief for you, and deny help to families who’ve lost jobs, unless we give huge extra tax cuts for the people who’ve already enjoyed the greatest tax-cut benefits and are least likely to spend that money to keep the economy strong. We’re saying: tax cuts for everybody on income up to $250,000 — and for money above that, to control the deficit, let’s go back to the rates of the 1990s, when the economy boomed. They’re saying: no tax cuts for anybody, unless there’s a special bonus for people at the very top.

We’re all for compromise — but not with bad, destructive, budget-busting ideas. That’s why we’re drawing the line here.

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Contra Solid ROI on TARP, Billions Sunk In Fannie/Freddie Bailout

by Metavirus on 21 October 2010
I love Matt Yglesias:
The flipside to the negative cost of the very controversial and much-loathed TARP bank bailout is that the bailout of Fannie Mae and Freddie Mac has already cost almost $150 billion and could cost $100 billion more before all is said and done.

The irony here is that though the passage of the Trouble Asset Relief Program was the subject of a gigantic high-profile controversy, absolutely nobody paid attention when Congress passed and President Bush signed the Housing and Economic Recovery Act of 2008 back in July 2008. The debate over the HERA didn’t spill over into the presidential campaign, nobody ran any ads in the 2008 or 2010 cycles hitting anyone for voting in favor of HERA. And the vote wasn’t even close. It passed the Senate by an 80-13 margin.

Since the election, there’s been a ton of commentary from right-of-center people about the evils of Fannie and Freddie but at the time of the actual bailing-out there was little comment on the action. Bryan Caplan said it was a mistake and we should have just let them flop, but Greg Mankiw and Tyler Cowen disagreed.

Fundamentally, I think Fannie and Freddie as they existed pre-crisis represented a bad implementation of the bad idea that government policy should promote the construction of large single-family owner-occupied housing. But the concept of pro-suburbanization industrial policy seems very broadly supported in American politics.

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